USDepartment of Transportation 1200 New Jersey Avenue SE General Counsel Off1ce of the Secretory Washington DC 20590 of TransportatiOn

March 17 2015

Donald S Clark Secretary Federal Trade Commission 600 Pennsylvania Avenue NW Washington DC 20580

Re Used Car Rule Regulatory Review 16 CFR Part 455 Project No P087604

The United States Department of Transportation (Department or DOT) is pleased to have the opportunity to comment on the Commission s supplemental notice of proposed rulemaking (SNPRM) published in the Federal Register on November 28 2014 As discussed below DOT has some suggestions to offer to the Commission on ways in which the Used Car Buyers Guide might be amended to provide additional information to consumers about safety recalls

The National Highway Traffic Safety Administration (NHTSA) an operating administration of the Department is charged with among other things overseeing and implementing programs to enhance motor vehicle safety and reduce the incidence of vehicular traffic crashes injuries and deaths associated with motor vehicles or motor vehicle equipment that contain safety defects or fail to comply with Federal Motor Vehicle Safety Standards (FMVSS)

In our first comment to the Commission s proposed rulemaking (dated May I 0 2013) DOT outlined the various methods that NHTSA uses to inform consumers about motor vehicle and equipment safety recalls Between the mailed notifications that manufacturers are required to send to vehicle owners and NHTSA s website wwwsafercargov where users can search for recalls and join a free email subscription service for recall alerts safety recall information has long been available to consumers Nonetheless we estimate that around 25 of recalled vehicles are not remedied Millions of vehicles are recalled every year to address safety defects and failures to comply with minimum safety standards Extrapolating for all vehicles recalled in the last 10 years an estimated 52 million vehicles on US roadways have a safety defect or fail to meet minimum safety standards

In an effort to reduce the numbers ofunremedied vehicles on US roadways NHTSA issued a final rule in August 2013 which requires large volume light vehicle and motorcycle

manufacturers to provide free safety recall completion look-up tools on their respective web sites 1 The fmal rule also requires manufacturers through adherence with techrtical specifications that NHTSA provides to transmit the same safety recall information to NHTSA s website so the same recall searches based on Vehicle Identification Numbers (VINs) can be conducted on wwwsafercar2ov

In August 2014 NHTSA launched a YIN look-up tool on its website2 which allows users to search for open safety recalls across all major light vehicle manufacturers (including motorcycles) With NHTSA s new tool a consumer can enter her 17 character YIN and quickly learn if her vehicle has any open safety recalls NHTSAs tool works across all major light vehicle manufacturers including 54 vehicle brands (shown in Figure 1 attached) Furthermore recall results must be accurate and the data no older than seven (7) days from when a consumer searches her YIN A YIN search sample result is shown in Figure 2 attached If an open recall does exist on a vehicle directions for contacting the manufacturer and obtaining the free remedy are provided to the user In the event the manufacturer does not yet have remedy parts available this must also be communicated in the recall results

In tandem with NHTSAs tool the same manufacturers launched YIN-based look-up tools on their respective websites These individual look-up tools must meet certain performance requirements3 which include being free and easily accessible not displaying sales or marketing messages and informing whether a vehicle has any open recalls Both manufacturer look-up tools and the NHTSA tool are regularly monitored to ensure that safety recall information is successfully disseminated in accordance with NHTSA s 2013 fmal rule

Nevertheless successful recall completion still hinges on consumer awareness of unremedied safety recalls that apply to a vehicle that the consumer either currently owns or is looking to purchase Consumers who are better informed are empowered to act wisely And that is precisely where the FTC through this rulemaking can have a direct and significant positive impact on individual consumer and the general public s safety By the FTCs own estimate4

almost 29 million used cars are sold by dealers each year These 29 million consumers need critical safety recall information during the used car transaction

Consistent with the FTCs SNPRM as to vehicle history the Department recommends the FTC consider a requirement that if a used car dealership has searched for uncompleted safety recalls on a vehicle it is selling whether as part of a vehicle history report or as a stand-alone search it provide those results to the buyer We propose that the FTC add a new statement and checkbox to the Buyers Guide that provides actual notice to used car shoppers about any outstanding safety recalls on the specific vehicle they are looking to purchase This statement could read for example If the dealer checked this box the dealer has checked safety recalls that have not been completed on this vehicle and will provide a copy to you upon request You can check for open

1 Early Warning Reporting Foreign Defect Reporting and Motor Vehicle and Equipment Recall Regulations 78 FED REG 51 382 (Aug 20 2013) 2 https vinrclsafercargovvin 3 See 49 CPR sect 57315 4 Supplemental notice ofrulemaking 79 FED REG 70804 70813 (Nov 28 2014)

2

safety recalls by visiting wwwsafercargov and entering the vehicles 17-digit YIN The statement could be prefaced with a checkbox to indicate if the dealer has searched the vehicles VIN for any open recalls Ifchecked the dealer would provide a simple print-out of the recall results and whether those results are part of a vehicle history report or a stand-alone search result NHTSAs wwwsafercargov website has a built-in print feature for recall results Recall results obtained from manufacturer look-up tools are also easily printable An example of our proposed statement can be found in Figure 3 attached

The Department s suggestion would not make the safety recall search compulsory (unless required under existing State law) However DOT has proposed a reauthorization bill the GROW AMERICA Act5 which would give the Department the authority to require used car dealers to remedy safety recalls before resale GROW AMERICA Actsect 4109 While GROW AMERICA contains a stronger requirement than our proposal today the FTC can also work to implement the changes to the Buyers Guide that the Department suggests here and this would help to improve consumer awareness of safety-critical information

We believe that our suggested approach provides a workable arrangement to benefit consumers without undue burdens to car dealers For dealers who search for open recalls and provide this safety-critical service to their customers this proposal would give them the opportunity as well to ensure that vehicles they sell are free from known safety issues And since manufacturers repair recalled vehicles free of charge perhaps some dealers will choose to have their recalled vehicles remedied before re-selling the vehicles to their customers See 49 USC sect 30120(a) For dealers who choose not to search a vehicles recall status there would be full transparency to the buyer as the checkbox would remain unchecked Perhaps most importantly this statement would make safety recalls part of the conversation when buying a used vehicle By learning a vehicle s safety recall status during the transaction a second owner can be armed with the needed information and where an open recall is discovered take the needed steps to obtain the free remedy

The Department would be pleased to offer any additional assistance that it can to the Commission in the consideration of this issue

Respectfully

I I

1 KJthfyn B Thomson

Attachments

5 httpwwwdotgovpolicy-initiativesgrow-america-factsgrow-america-improvingshytransportation-safety

3

Acura

Audi

BMW

BMW Motorcycles

BRP Can-Am

Buick

Cadillac

Chevrolet

Chrysler

Dodge

Ducati Motorcycles

Ferrari

FIAT

Ford

Genuine Scooters

GMC

Harley -Davidson

Honda

Honda Motorcycles

ATTACHMENTS FIGURES 1-3

Available Manufacturers Hummer

Hyundai

lnfiniti

Jaguar

Jeep

Kawasaki

Kia

KTM Motorcycles

Land Rover

Lexus

Lincoln

Mazda

Mercedes-Benz

Mercury

MINI

Mitsubishi

Nissan

Oldsmobile

Polaris

Pontiac

Porsche

ProMaster

RAM

Saab

Saturn

Scion

SMART

Subaru

Suzuki Motorcycles

Tesla

Toyota

Triumph

Volkswagen

Volvo

Yamaha Motorcycles

Figure 1 - Manufacturers available through NHTSAs YIN Look-up Tool

4

-~-~

safercargov - --shy_~~

--~ ~ --~ middot~ bull ~~-

middot flt -

middot middot ~- middot~~~

middot middot

- I bull-

You are here Home I Vehicle Owners VlN

Do You HltM a Safety Recalls Results Look-up by VIN

VIN Search for all Recalls

Year 2005 Make TOYOTA Model Sienna Complaints amp Investigations Number of Open Recalls 5

NHTSA Recall Number~ Recall Date May 22 20middot Jbull Recalls Look-up by VlN

llanuf~cturer Recbullll Number E1S(Vehicle ldentJfica11on Number)

SUtHl ARY Recalls FAO Toyota Motor Engineenng amp t1anufactunng (Toyota) IS recalling cenain model year 2004-2011

Receigte U~dates for Latest Sienna vehicles onginally sold 1n or currently registered 1n Connec~cut Delaware llhnois Recalls Indiana Kentucky Ma1ne Maryland 1middot1assachusetts Mtchtgan flinnesota New Hampshire

Sl~n-up ror Email Alerts New Jersey New York Oh1o Pennsylvania Rhode Island Vemnont Virginia West Virginia

SubscnM to RSS Feecs Wiscons1n and the 0 1stnct of Columbta The affected vehicles have a spare tire carrier assembly mounted under the vehicle whose attachment cable may corrode due to high

Resources concentrations or road salt splashing onto the spare tile earner

Databases (Fla t Files) SAFETY RISK If the carrier cable ts corroded due to road sa~ the spare tile may separate from the vehtcle

Passenger Van Safety increasing the risk or a crash

Problem or Complatm

F1 1e a Com~lalnl Now

Print

Emergency Response RHIEDYVehicles

Toyota wtll send owners an intenm noJfication to advtse owners of the recall and dealers wtll remove the spare tile and relocate It to the luggage companment free of charge Owners wtll be mailed a second letter when remedy parts are available and dealers will replace the spare tile carrier assembly wtth an 1mproved one free of charge The manufacturer has not yet provided a notification schedule Owners may contact Toyota customer service at 1-800-331shy4331 NOTE 2004-2010 S1ennas subject to thts recall were subject to recall campa1gn 10Vshy160 initiated tn 2010 Those owners are advised that they must have their vehicles remed ed aga1n under thts campa1gn and that having the earlier recall completed did not remedy ther vehicles Additionally model year 1998-2003 Stennas were recalled as pan of safety recall 1OV-160 Owners of those vehtcles that have not had not the remedy perfomned on their vehicles should contact their Toyota dealer to schedule a free repair

RECALL STATUS Recall INCOMPLETE R emed y not yet available

fIANUFACTURER tiOTE S

THIS RECALL OAT LST RfRESD Fao middot0 201

NHTSA Recall Number all22 Manufacturer Recall Number gtOR

6Figure 2 - Example ofNHTSA YIN Look-up results

0 If the dealer checked this box the dealer has checked safety recalls that have not been completed on this vehicle and will provide a copy to you upon request You can check for open safety recalls by visiting wwwsafercargov and entering the vehicle s 17-digit YIN

Figure 3 - Example of proposed Buyers Guide statement

6 Results are for a NHTSA test vehicle subjected to destructive testing and are used for demonstration purposes only See httpwwwnhtsagovappsjspsalvagesalvage htm

5

-~-~

safercargov - --shy_~~

--~ ~ --~ middot~ bull ~~-

middot flt -

middot middot ~- middot~~~

middot middot

- I bull-

You are here Home I Vehicle Owners VlN

Do You HltM a Safety Recalls Results Look-up by VIN

VIN Search for all Recalls

Year 2005 Make TOYOTA Model Sienna Complaints amp Investigations Number of Open Recalls 5

NHTSA Recall Number~ Recall Date May 22 20middot Jbull Recalls Look-up by VlN

llanuf~cturer Recbullll Number E1S(Vehicle ldentJfica11on Number)

SUtHl ARY Recalls FAO Toyota Motor Engineenng amp t1anufactunng (Toyota) IS recalling cenain model year 2004-2011

Receigte U~dates for Latest Sienna vehicles onginally sold 1n or currently registered 1n Connec~cut Delaware llhnois Recalls Indiana Kentucky Ma1ne Maryland 1middot1assachusetts Mtchtgan flinnesota New Hampshire

Sl~n-up ror Email Alerts New Jersey New York Oh1o Pennsylvania Rhode Island Vemnont Virginia West Virginia

SubscnM to RSS Feecs Wiscons1n and the 0 1stnct of Columbta The affected vehicles have a spare tire carrier assembly mounted under the vehicle whose attachment cable may corrode due to high

Resources concentrations or road salt splashing onto the spare tile earner

Databases (Fla t Files) SAFETY RISK If the carrier cable ts corroded due to road sa~ the spare tile may separate from the vehtcle

Passenger Van Safety increasing the risk or a crash

Problem or Complatm

F1 1e a Com~lalnl Now

Print

Emergency Response RHIEDYVehicles

Toyota wtll send owners an intenm noJfication to advtse owners of the recall and dealers wtll remove the spare tile and relocate It to the luggage companment free of charge Owners wtll be mailed a second letter when remedy parts are available and dealers will replace the spare tile carrier assembly wtth an 1mproved one free of charge The manufacturer has not yet provided a notification schedule Owners may contact Toyota customer service at 1-800-331shy4331 NOTE 2004-2010 S1ennas subject to thts recall were subject to recall campa1gn 10Vshy160 initiated tn 2010 Those owners are advised that they must have their vehicles remed ed aga1n under thts campa1gn and that having the earlier recall completed did not remedy ther vehicles Additionally model year 1998-2003 Stennas were recalled as pan of safety recall 1OV-160 Owners of those vehtcles that have not had not the remedy perfomned on their vehicles should contact their Toyota dealer to schedule a free repair

RECALL STATUS Recall INCOMPLETE R emed y not yet available

fIANUFACTURER tiOTE S

THIS RECALL OAT LST RfRESD Fao middot0 201

NHTSA Recall Number all22 Manufacturer Recall Number gtOR

6Figure 2 - Example ofNHTSA YIN Look-up results

0 If the dealer checked this box the dealer has checked safety recalls that have not been completed on this vehicle and will provide a copy to you upon request You can check for open safety recalls by visiting wwwsafercargov and entering the vehicle s 17-digit YIN

Figure 3 - Example of proposed Buyers Guide statement

6 Results are for a NHTSA test vehicle subjected to destructive testing and are used for demonstration purposes only See httpwwwnhtsagovappsjspsalvagesalvage htm

5